Wellington Drive to raise $8.5m

Monday 14th September 2009

Wellington Drive Technologies, which designs and builds energy-saving motors and fans, plans to raise $8.5 million via a placement of shares to its biggest investor, Australian ethical fund manager Hunter Hall Investment Management.

The company agreed to place 85 million new ordinary shares at 10 cents apiece to Hunter Hall, it said in a statement. The transaction is subject to shareholder approval because it will push Hunter hall’s stake to above 19.9%.

Wellington Drive plans to hold a shareholder meeting in late October to vote on the plan, it said. The company will also make a further “small” placement to institutions and offer a share purchase plan to allow other shareholders to participate in the capital raising. It didn’t give details.

Shares of Wellington Drive last traded at 9 cents and have dropped 19% in the past month.

Last month the company posted a first-half loss of $9.85 million, about double the year-earlier loss as revenue surged 66% to $10.8 million. The first-half gross margin was eroded by costs to rationalize its UK warehouse operations and relocate ventilation motor production to Singapore from New Zealand.

Businesswire.co.nz

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